26 November 2014

Agreement reached to re-instate broadly supported elements of FOFA reforms

The Government has agreed with the Opposition that a revised regulation to progress the broadly supported elements of the disallowed Future of Financial Advice (FOFA) Regulations be re-made by the Government before the end of this year.

The Government has given notice of a motion in the Senate to give effect to this by seeking the support of the Senate.

The agreement provides that the following specific elements of the Government’s amendments, which were disallowed on 19 November 2014, will be able to be re-made in a new regulation:

  • amendments to the grandfathering provisions that will address unintended consequences, and facilitate competition in the financial advice industry, by enabling advisers to move licensees with their clients whilst continuing to receive grandfathered remuneration;
  • amendments to the training and education provisions that specify that benefits in relation to education and training that relate to conducting a financial services business are not conflicted remuneration;
  • amendments to the stamping fee provisions that clarify its application to capital raising activities and broaden its application to include investment entities;
  • amendments to the accountants’ certificate renewal period to provide that the extended two year renewal period also applies in relation to FOFA; and
  • amendments to the brokerage-related provisions of FOFA to extend the provisions to products traded on the ASX24.

The new Regulation will commence the day after it is registered.